FAR 52.216-7, Allowable Cost and Payment (Part 2 of 2)

Applicability: This FAR clause is incorporated in cost reimbursement contracts and Time-and-Materials (T&M) contracts for other than commercial items. For T&M contracts, the clause only applies to the part of the contract that reimburses materials on the basis of actual cost. The clause also includes four alternate versions, whose inclusion was discussed in Part 1 of this two-part series.   Key Requirements: The clause addresses two key areas, (1) interim reimbursement of costs, and (2) determination of final indirect rates. Part 1 of the two part series addressed the interim reimbursement of costs. This Part 2 of our series addresses the determination of final indirect rates. In regards to the determination of final indirect rates, the clause requires the contractor to submit an adequate final … Continue reading

FAR 52.216-7, Allowable Cost and Payment (Part 1 of 2)

Applicability: This FAR clause is incorporated in cost reimbursement contracts and Time-and-Materials (T&M) contracts for other than commercial items.  For T&M contracts, the clause only applies to the part of the contract that reimburses materials on the basis of actual cost.  The clause also includes four alternate versions, which are included in contracts as follows (the alternate versions generally provide additional wording regarding the frequency of payments): Alternate I is included in Construction Contracts that also include the clause at FAR 52.237-27, Prompt Payment for Construction Contracts; Alternate II is included if the contract is with an educational institution; Alternate III is included if the contract is with a State or local government; and Alternate IV is included if the contract is with (a) a … Continue reading